What if Stamp Duty was Abolished

County taxes/federal taxes - its dependent on the value of the property and each State in US will vary. Atlanta taxes are pretty reasonable I pay around $2000 pa per property. If it was Texas possibly double this

 

Correction: My message above should read "no capital gains tax". (Not "no stamp duty"). Hk and Sg do indeed have a stamp duty payable, which sadly has risen from very low rates over the last 6 or so years ...

 

Pretty sure ACT has a phase out over a relatively long period - that could be a could practical example to this 'what if' scenario. Corresponding land tax increase though.

In terms of tax efficiency, land tax > stamp duty.

 

You don't pay CGT in USA if you are selling and using those funds for another property, just have to fill out appropriate form which accountant completes.

I really like Investor Friendly countries.... Australia wants a bite from the apple every which way.

If you are a developer you pay, stamp duty, GST and dependent on structure 30% on profits. You need to be making significant profits to play as a developer because your business partner is ATO.
OK, enough of the rant

 

If it is grandfathered then there will be less people selling them which may push prices higher.

For simplistic sake if someone had 120k and were using 100k deposit and 20k for stamp @ 80LVR they would purchase a 500k property.

Without accounting for stamp duty the person could now purchase up to 600k.

This would mean people on the boat will likely inherit the stamp duty just the same as the first home buyers grant did except now it can effect all markets.

 

I would take that as an option.

Spoiler

Then offload everything the following year and use the stamp duty refunds as deposits.

 

I'll add to the rant. You also have an expensive cost of labour, minimum wage laws, overtime laws and currupt unions to deal with, all of which add to the expense ...

 

This is true if they are LVR capped (i.e. not much of a deposit).
The ongoing Land Tax would have an affect on your servability but.
So in effect probably becomes easier to get the first property but harder to get the last (keep acquiring more).

But if they implement the system like ACT, it should be a slow transition.

 

@Terry_w can you elaborate on how this would help these strategies?

 

Transferring/selling from 2 owners into 1 for risk (great for business owners - 1 person owns the house the other owns the business), as there would be no stamp duty.

Selling from the high income earner to the lower income earner once the property becomes CF+ (less tax paid).

Plus many more

 

Sales to related parties.

 

If they did this, not only would it be jacked up on us all later on, and probably be payable on our homes as well, but the obvious problem staring at me, is it will INCREASE investor activity, it will cause property prices to accelerate quicker (can you imagine Syd and Mel today if stamp duty was gone 4 years ago)

Then you will have people pop up who want to make even quicker money.

Wrong from every angle if you ask me.

 

Cha Ching

 

Bad things happen if buyers/investors don't pay attention, interest rates have already started rising, first trigger, boom been going since 2013... common sense should prevail one would think??

 

Knowing the ability of the govt to get things wrong, who knows, they may pass it with gusto to help with the un affordability problem

So would that have you back into Syd MTR, maybe you can start your own flipping show

 

I think it means people piling in at the end, paying too much as rates are going up and market could turn at any time making you hold a property with a loss straight away, FOMO as is now often being said.

 

Yes.

 

Also known as Party Time!!!!!
Bring it on I say!!!!
But look for the chair early as when the music stops it could be a very painful fall.